LEWISTON — Managers in Maine’s biggest cities were sharpening their budget pencils and re-crunching  numbers Thursday in the wake of a Gov. Paul LePage line-item vetoes to the state budget.

The veto that’s giving city officials consternation cuts the amount the Legislature set aside in the state budget to partially reimburse cities for costs through General Assistance welfare programs by about $5 million.

Republican legislative leaders have said they will resolve the matter when the Legislature reconvenes in mid-May to take up a supplemental budget for the state’s Department of Health and Human Services.

But for cities trying to get approval of their budgets in time for the new fiscal year that starts July 1, the LePage veto throws the process into a tailspin.

A coalition of Maine’s big city mayors, including Lewiston’s Robert Macdonald and Auburn’s Jonathan LaBonte, urged state lawmakers to stand by the bipartisan budget they passed last week and restore the funding. 

“We appreciate the hard work of the Legislature in developing this compromise and the overwhelming support it received in both the House and Senate,” Macdonald said in a statement released by the Mayors Coalition on Jobs and Economic Development. “We are prepared to stand by it and work to further improve the program and control its costs.”

For Lewiston, the veto puts into question how much of an estimated $1.6 million in General Assistance funding will be paid for by the state and how much will come from local property taxpayers.

In a statement released Thursday, LePage defended his veto by saying cities’ and towns’ General Assistance programs are under their control.

“The mayors’ assertion that the proposed welfare changes will shift millions of dollars in costs from the state to local property taxpayers is a local choice. Under the block grant proposal, the state has offered municipalities substantial flexibility with regard to program design, eligibility, nature of assistance, and other program elements,” LePage stated.

Lewiston City Administrator Ed Barrett said Thursday the veto combined with other recent changes in state law including new time limits for those on state and federal welfare programs and a newly crafted reimbursement rates for cities is making it nearly impossible to accurately forecast the city’s costs for the coming year.

It’s a Catch-22 for cities because they are legally obligated under both state and federal law to provide benefits to those who are eligible, Barrett said.

Lewiston, like other cities in Maine, is in the throes of budget building for the next fiscal year. Barrett said Lewiston usually adopts a final budget by the end of May and was hoping to do that by May 15.

The recent adoption of a 60-month limit for those receiving support from the federal Temporary Assistance for Needy Families program also means more families will look to city programs for help.

In Lewiston, 337 families will lose TANF benefits in May and city officials estimate about 25 percent of them, or about 84 families, will turn to the city for help. But it’s still unclear how many of those families coming off TANF will need General Assistance help, how much help they will need and how long they will remain eligible.

While the state lowered the maximum amount of General Assistance the city must provide to eligible residents from $800 a month to $720, those savings could be offset by more people seeking city assistance, Barrett said.

“With all the changes in the General Assistance program, I’m of the opinion that we are not going to know the actual impact until we get into the new year and see what actually happens,” Barrett said. 

Meanwhile, changes in the state’s reimbursement formula for cities are also now uncertain. Under the budget just passed, the state would reimburse Lewiston for 50 percent of their General Assistance costs until those costs reach $700,000. The new formula then reimburses the city 85 percent of its costs over $700,000, Barrett said.

That threshold amount varies from city to city and is based on a city or town’s total property valuation, but the vetoes are particularly problematic for the state’s largest cities such as Lewiston, Bangor and Portland.

Because they are considered regional “service centers” and often host other services or facilities that the poor depend on, they see a disproportionate amount of demand on General Assistance, according to Geoff Herman, director of state and federal government relations for the Maine Municipal Association.

When lawmakers meet in May they could conceivably redraft the General Assistance formula when they build a supplemental budget for the state’s Department of Health and Human Services.

LePage has asked legislators to make structural changes to the way the state reimburses for General Assistance and wants to reimburse all municipalities at 50 percent of costs, regardless of how much they spend.

“While General Assistance is a state and local partnership, the current path we are on is unaffordable at both levels of government,” LePage said in the statement. “State spending in this welfare program has grown from nearly $7 million in 2008 to a projected $14.3 million in 2013. I am looking at a way to sustain our welfare programs for Maine’s most needy.”

But Herman said the veto will likely impact all 490 municipalities in Maine, even those that don’t spend enough on General Assistance to ever receive more than a 50 percent reimbursement.

“Only a handful of cities receive this enhanced reimbursement,” Herman said. “But this veto creates a hole of nearly $5 million that will mean the state won’t have enough money to reimburse any municipality under the current formula.”

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